Elon Musk totaled a $1 million McLaren with Peter Thiel riding shotgun — and hadn't bought insurance

As if parallel-parking rockets in space wasn't enough, Tesla [NASDAQ: TSLA] and SpaceX [NASDAQ: SPCX] founder Elon Musk also once took a shine to hightailing around Silicon Valley in a classic $1 million McLaren, and subsequently totaled the vehicle with none other than billionaire financier Peter Thiel along for the ride. What's more, the world's wealthiest individual was driving without auto insurance when the crash occurred.

The year was 2000, and Musk had cash to burn after his Zip2 windfall, after he sold the online city-guide software company to Compaq for $307 million in 1999 .

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With his $22 million cut from the deal, Musk set his sights on a 627 horsepower, 240-mph McLaren F1, which he snapped up for $1 million. Soon, Musk was tooling around California's Bay Area, and often cruising between San Francisco and Los Angeles in the vehicle.

One day, in 2000, the PayPal cofounders took the McLaren to Palo Alto, where the duo planned to brief venture capital company Sequoia Capital on a finance deal.

En route, Thiel asked Musk how fast the McLaren could go; Musk turned to him and reportedly said, "Watch this."

Moments later, Musk lost control of the vehicle, which went airborne and then careened into an embankment, essentially destroying the vehicle. Both passengers were uninjured.

Thiel recalled the crash in a 2017 New York Times interview .

"It was a miracle neither of us were hurt," he said. "I wasn't wearing a seatbelt, which is not advisable. Elon's first comment was, 'Wow, Peter, that was really intense.' And then it was: 'You know, I had read all these stories about people who made money and bought sports cars and crashed them. But I knew it would never happen to me, so I didn't get any insurance.' And then we hitchhiked the rest of the way to the meeting."

No coverage leads to big headaches, auto insurance experts say

Not having vehicle insurance is asking for trouble, for trillionaires and for Toyota drivers, especially those with lead-foot driving habits.

"The car is the smallest risk," W. Travis Patterson, managing partner at Patterson Law Group in Fort Worth, Texas, told Moneywise. "If you total your own uninsured car, you lose the car. If you hit someone else, you owe whatever a jury says their injuries are worth, and no amount of wealth caps that number."